Premium bonds

flook said:
I'd disagree there, I'm getting 4.6% return on my holding over the past 12 months, tax free obviously, so equivalent to over 5.5% in a easy access account, doubt you would find that very easily at a bank.

Different of course if you are prepared to lock the money away for a year or two, or take a risk on the stock market
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It's been higher recently due to the high interest rates, but prize fund is now 4.4%, so similar to what you're getting, but it's an average, impacted by the larger prizes. As I mentioned, those rates have been less than inflation for the last year or so, so you've lost buying power.

As I said, a reasonable place for money you might need in the short term, as often better than bank rates, especially considering the tax, but not an investment and a bigger risk than the stock market over a longer term.
 
Still can't get my head around why people invest in these, unless they're just part of a wider portfolio

Chances are that the vast majority of people will lose money by investing in these over the stretch of 5-10 years
 
chris85mcfc said:
Still can't get my head around why people invest in these, unless they're just part of a wider portfolio

Chances are that the vast majority of people will lose money by investing in these over the stretch of 5-10 years
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When I first invested it was my self employed tax money that I didn't need for six months, then it became a "fun" investment
I have 10k invested and its now my emergency fund, if I ever need cash relatively quickly
When bank saving interest rates were at 1%, and if you were cash rich, you may as well have dumped 10k in and treated it like you would the lottery
If I won £100 in a year, that was break even. If I won nothing, it was the equivalent of £2 a week, less than the cost of a Euromillions ticket
I won £500 this month, which is the equivalent of a 5% return, the same as my two year cash isa
 
dickie davies said:
When I first invested it was my self employed tax money that I didn't need for six months, then it became a "fun" investment
I have 10k invested and its now my emergency fund, if I ever need cash relatively quickly
When bank saving interest rates were at 1%, and if you were cash rich, you may as well have dumped 10k in and treated it like you would the lottery
If I won £100 in a year, that was break even. If I won nothing, it was the equivalent of £2 a week, less than the cost of a Euromillions ticket
I won £500 this month, which is the equivalent of a 5% return, the same as my two year cash isa
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Money loses value over time, so if you're not beating inflation with your winnings, you're effectively losing money

I just think there are better low risk options where you're likely to see a better return
 
denislawsbackheel said:
Current CPI is 3.4% so a 5% return on premium bonds is beating inflation.
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'Current', by then youre playing catch up

If you're getting a 5% return every year then fair enough, but that's not likely with premium bonds

Current average return on bonds is 4.4%, but some will end up with more and most will end up with less
 
chris85mcfc said:
'Current', by then youre playing catch up

If you're getting a 5% return every year then fair enough, but that's not likely with premium bonds

Current average return on bonds is 4.4%, but some will end up with more and most will end up with less
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You are quite right of course but
On a total of £9600 worth of premium bonds my winnings this year have been
J £100
F £150
M £50
A £50
M £150
Total £500

Great fun.
 
Don’t think I’ll cash in my 55 year old £1 premium bond just yet.
 
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